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Zagari v. International Union of Electronic

December 7, 2007


The opinion of the court was delivered by: Charles J. Siragusa United States District Judge



This case involves a dispute concerning a collective bargaining agreement, and now is before the Court on Defendants' motion (# 20) to dismiss the amended complaint pursuant to Federal Rules of Civil Procedure 12(b)(6), 9(a) and 8(b)(6). For the reasons stated below, the motion is denied.


This case is joined with several others*fn1 in which Plaintiffs*fn2 allege similar wrongful conduct on the part of Defendants. Plaintiffs' counsel states in her memorandum of law that,

In total, the undersigned plaintiffs' counsel filed thirty (30) substantially, though not identical, Complaints against the Union. The plaintiffs fall into two categories: (1) those, such as Mr. Zagari, who were actively employed by Valeo and were members of the Union at the time of [sic] the September, 2005 ratification vote took place; and (2) Those, such as plaintiff Alonci, who separated their employment within a short time prior to the September, 2005 amendment pursuant to the terms of the May, 2002 amendment to the Collective Bargaining Agreement. (Pl.'s Mem. of Law (# 22) at 2.)

The Court will presume the following allegations from the complaint to be true for the purposes of this motion:

5. The plaintiff is employed by Valeo Corporation (hereinafter referred to as "Valeo" and/or "company") in the general capacity of an Assembly worker.

6. Plaintiff commenced his/her employment with Valeo on or about November 18, 1985.

7. During his/her employment with Valeo the plaintiff has been, and is currently, a member of the International Union of Electronic, Electrical, Salaried, Machine & Furniture Workers, AFL-CIO, and its Local 509 (IUE-CWA, Local 509) (collectively hereinafter referred to as "Union").

8. By virtue of the plaintiff's payment of dues as a membership fee to belong to the Union, the Union owes the plaintiff a duty of care and the duty of fair representation of plaintiff in matters pertaining to his/her employment which are encompassed within the collective bargaining agreement. The Local Union, upon information and belief, can only undertake actions on behalf of its members that are in keeping with those directives of the International Union and upon engaging in those actions does so with the backing and acquiescence of the International Union.

9. On or about July 20, 2000 the Union and the company negotiated the terms of a collective bargaining agreement which was ratified and deemed to go into effect on August 14, 2000.

10. The agreement was touted by the Union to be highly beneficial to its members and was to remain in effect through September, 2008.

11. Commencing only three short months after ratification of the collective bargaining agreement, the company started a quest to get out of its obligations pursuant to the collective bargaining agreement.

12. On December 14, 2001, presumably due to failure on the part of the company to get out of the collective bargaining agreement, the company filed for bankruptcy protection.

13. The Union described the concessions being sought by the Company as "wage concessions on average of $3.00 per hour, huge cuts in health care benefits with large out of pocket costs and severe, seniority threatening, work practice changes."

14. Subsequent to the bankruptcy filing of the Company through which it commenced a plan to repay its debt, the Union reached what it termed a "concessionary agreement" which was ultimately ratified by its membership based upon the Union's unanimous recommendation to its membership that the same be approved as an amendment to the July, 2000 agreement. Ultimately, upon information and belief, the company came out of bankruptcy within one year and nearly paid its creditors in full.

15. The concessionary agreement changed the terms of the original contract only as to those topics outlined in the "highlight booklet" that was handed out to union membership to review prior to the ratification meeting. Union members were told to bring said booklet to the ratification meeting as the union would not be handing out copies at the meeting.

16. Despite the amendment to the original Collective Bargaining Agreement, the company persisted in its scare tactics designed to caused the Union to submit to its demands. The company engaged in a virtually continuous course of banter claiming that the costs of doing business at the Rochester facility were too high and that it would likely have to file bankruptcy declaring itself insolvent or close the plant.

17. Upon information and belief, the company's economic condition and business prospects for the Rochester, New York facility were not as bleak as portrayed, but he [sic] Union failed to take sufficient steps to investigate the true financial picture of the company in order to remain a strong bargaining force on behalf of the employees remaining in the employment of the company.

18. Through the use of layoffs and attrition programs permitted via the 2002 amendment to the bargaining agreement, the company held firm to a course of reducing the number of employees at the Rochester facility. In fact, through September, 2005, the work force at Valeo dwindled from it original number of approximately 3,500 employees to only approximately 510 hourly employees.

19. Upon information and belief, during the time frame between January, 2005 and July, 2005, the company began to step up its plan to close the Rochester facility. During this time frame, Union officials were aware of Valeo's intention to close the plant at the conclusion of the collective bargaining contract which was previously September 30, 2008, but was shortened to July 31, 2008 by the May 2, 2005 Amended Contract.

20. Despite the Union's awareness of the very real possibility that Valeo was going to make good on its threat to close the Rochester facility, no genuine steps were taken by the Union to request bargaining with the company designed to offer additional concessions to the company in order to keep the facility open.

21. Upon information and belief, the union employee numbers had decreased to a point that the dues being paid to the Union for this facility was deemed to be insignificant to the Union. Therefore, from an economic standpoint the Union did not have sufficient interest in keeping this facility open.

22. On or about July 27, 2005, Valeo officially announced its decision to close the Rochester, NY facility citing poor economic conditions impacting the automotive industry.

23. While plaintiff acknowledges that the automotive industry has suffered financially in recent years, plaintiff does not acknowledge that the Rochester facility was lacking sufficient business contracts to remain open and profitable.

24. In fact, very soon after the announcement of the plant closure, Valeo received a contract from Ford Motor Company which was lucrative enough to warrant the Rochester facility staying open. Upon information and belief, Union officials were aware, prior to the ratification vote for the amended contract attained through "effects bargaining" that Valeo would be awarded this contract.

25. The company's announcement is misleading as Valeo will continue to perform the work associated with contracts previously fulfilled through the Rochester, NY facility at other of its facilities located in Ohio, Mexico and upon information and belief, China. As such, despite the use of the terminology "plant closure" the work is merely being relocated, inclusive of the work which will be done under the new Ford contract. In fact, upon information and belief the work previously ...

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